Right now, the roughly $150 billion/year going into cloud infrastructure is paid for with cash flow. Most of that cash flow comes from free services.
It’s ad-supported services that are holding up the free Internet. It’s these ad-supported services that the clouds were first built to support.
The antitrust bills now zipping along in Congress try to end all the perceived “sins” of the Cloud Czars – Apple, Microsoft, Amazon, Google and Facebook. But they don’t answer the big question, which is where new cloud investment will come from if the Czars are broken up.
Amazon can do fine on its own. There is plenty of cash flow coming into Amazon Web Services to support its capital spending. Most of Amazon’s investment these days, in fact, is going into warehouses and transport fleets, which aren’t as profitable. Splitting AWS from Amazon, along with its digital services like Amazon Prime video, the Kindle eBooks, and Alexa cloud-based speaker, would be a stupendous opportunity for investors. It would let AWS grab share from Google and Microsoft because their clouds are tied to software that competes with their customers.
For Google and Facebook, it’s more problematic. It’s especially so since this is where today’s free services live. Congress is treating these companies as though they’re just software when they’re also essential infrastructure. You can’t learn about the world without Google search. Facebook is the world’s free communication network – not just America’s free system but the world’s free system.
I came up with the term “Cloud Czars” instead of Big Tech to make this clear. The cloud was built to house these free services. You can’t easily separate the two without doing enormous damage to the free Internet.
Yes, clouds can continue with paid services. But if all services must be paid for then the resource is only available to those who can pay. Most people around the world still can’t.
